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Sieren‘s China: High-quality instead of low-cost?

There’s nothing new about the EU criticizing the quality of Chinese products. The news is that this is now unpleasant for Beijing, which wants manufacturers to produce better goods, writes DW columnist Frank Sieren.

Until now, China's industry has used its image of being a cheap producer of goods to conquer markets worldwide. Now it needs quality to maintain them, and pressure from outside is coming at the right moment.

The European Commission has recently submitted a list of dangerous goods that are imported from abroad into the EU. It covers everything, except food and pharmaceutical products. Ever since the EU warning system was set up in 2003, almost 20,000 dangerous items have been confiscated.

This year alone, Commission guidelines consider some 2,500 articles to be hazardous. Two-thirds of these products came from China, as in previous years. Mostly toys that could harm or suffocate children, but also products which could ignite due to electrical short circuits, were pulled off the market. Clothing and leather goods, such as belts, as well as jewelry, are also problematic goods, as they often contain allergenic substances or harmful heavy metals. An updated EU report is published every year.

So now, China has a new approach: Instead of worrying about condescending European attitudes, they use the force of the attack to their advantage, as do many Asian martial arts.

According to an opinion article in the state newspaper "Global Times", a study cited "a warning to the domestic industry" to work on quality. If products did not improve, then not only foreign buyers, but also the Chinese would soon reject them and order abroad instead. "Made in China 2025" was, therefore, the buzzword China's Premier Li Keqiang used to reinvent China's industry at the National People's Congress in early March. Li announced that over the next ten years, China would make the transition from "big industry" to "strong industry". In the future, the focus is be on innovation and quality.

High profits for cheap goods

The only question is how will low-cost producers respond because Li Keqiang is mainly interested in high-tech production. The problem with low-cost producers is not their lack of ability to improve quality, but their willingness to do so. They make more money off of cheap goods and there are hundreds of millions of new consumers, who still cannot afford anything else, like people on the African continent. European inspectors won't faze Chinese producers of cheap goods because they mostly sell in domestic and emerging markets, and maybe three containers will be shipped to Europe and no one will notice that the colors used are hazardous to children. This will probably go on for a few more years.

However, the Chinese government has a slightly different view of the problem. Cheap is over: it's time for the quality consumer experience.

Beijing feels the pressure of discontented middle-class consumers. More and more of them refuse to buy Chinese products or at least products that are not produced by western brand manufacturers in China because they know about all the junk and copies on the Chinese market. They love to shop when they travel abroad and are willing to pay a higher price - not just for luxury items, but also for everyday needs: from cooking pots and milk powder to toys and furniture. A lot of it is "Made in China", but has withstood the quality tests of the West.

This is economically costly and impractical but threatening with the EU reaction does little to change the situation. Only tough inspections and heavy penalties will make producers forego quick and high profits. It will take a few years, however, for these measures to be established.